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Business

October 13, 2017

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‘Low canal water charges keep infrastructure in shambles’

‘Low canal water charges keep infrastructure in shambles’

KARACHI: Extremely lower and flat canal water charges worsen infrastructure and discourage farmers to use advanced conservation technologies in Pakistan where agriculture sector consumes more than 90 percent of annual water available in the country, the central bank said on Thursday.  

“In Pakistan, canal water charges, also called abiana, are very low, as the canal irrigation cost stands negligible when compared to its close alternate, say tube well irrigation,” the State Bank of Pakistan (SBP) said in a state of the economy report. 

SBP calculated water charges at Rs1,800 per hectare (2.5 acres) compared with abiana rates between Rs85/hectare in Punjab and Rs617.8/hectare in Khyber Pakhtunkhwa. 

“Ideally, water prices should reflect the value that users generally place on their consumption. In this way, a proper pricing strategy can be used as a tool not only to recover the cost of operation and maintenance of the system, but also to contain water losses and promote conservation,” it said. 

The central bank further said abiana rates have no link with the amount of water being consumed.  It said provincial governments charge a flat rate as abiana on the basis of cropped area. As a result, once the cropped area has been determined, the incremental cost of applying extra water falls to zero. 

“Similarly, the tariffs are unreflective of the water intensity of various crops. For example, rice and cotton on average are charged at Rs85 per acre; even though rice consumes 60 percent more water than cotton,” it added.

“The prevailing pricing structure, which has no link with consumption, discourages water conservation.”  SBP said farmers do not have an incentive to invest in simple and cheap technology, such as laser leveling of land and bed-furrowing and more advanced technologies, like drip irrigation and sprinkler. “Thus, large quantities of water are allowed to flow in the fields allowing for wastages through evapo-transpiration.”

The central bank said lack of legislation allows defaulters of water tariffs payments to go scot-free.  It said the inefficient distribution system keeps water productivity lower in the country. Water productivity for cereal crops in Pakistan is almost one-third of that in India, and one-sixth of the productivity realised in China, it added, citing a study. “Unreliable and rigid water distribution system also explains the low productivity of water (defined as the average crop product per unit of water consumed).” 

SBP said farmers have turned to groundwater pumping due to the unpredictability associated with canal water supplies. The number of tubewells installed has increased sharply over the years, while groundwater has now become a significant source of water, as its contribution to irrigated agriculture has doubled in the last 40 years from 25.6 to 50.2 million acres feet.

“This is equivalent to 50 percent of overall canal water withdrawal for irrigation,” it added. “Industries and domestic sector also relies on groundwater resources for water supply.” The central bank said farmers at the tail-end remain at a disadvantage, whereas those at the head benefit.

The growers near the canalhead sometimes apply water 4 to 5 times each season as compared to tail-end farmers. “This places tail-end farmers at a disadvantage, adversely affecting the crop quality and yields,” it added. “Hence, such inequity leads to reliance on groundwater pumped through private tubewells, which is costly. As a result, tail-end farmers pay up to 30 times more for water access.”

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